Northern Gateway pro and con

Peter Kent seems unswayed by official American criticism of an Enbridge oil spill in Michigan—though apparently he has yet to read the actual report in its entirety.

The report has provided fuel for critics of Enbridge’s proposed Northern Gateway project, which would carry crude oil along 1,170 kilometres of pipeline from Alberta to British Columbia’s coast. Even B.C.’s premier has demanded answers.

But the report won’t change the opinion of the federal Conservative government, which has hailed the Northern Gateway pipeline as important for the country, said Environment Minister Peter Kent. ”Pipelines are still, by far, the safest way to transport petrochemicals in any form,” Kent said in an interview Wednesday.

Wild Rose leader Danielle Smith, on the other hand, is ready to consider alternative routes.

“I’ve heard that there are options that would go to the West Coast on a different route that might make more sense,” Smith told reporters during a break in the Wildrose caucus retreat in Chestermere. ”There may have been in the past an easier time going through virgin territory,” Smith said. “But something’s changed in the last five years. Landowners are far more active and concerned, environmental groups are more active and concerned. First Nations are more active and vocal about it.”

Land-locked Alberta must get its oil to new markets, she said. But it makes sense to look at existing rights of way “so that we can have the least amount of environmental damage.”

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Northern Gateway pro and con

Out of fairness, the final report has not yet been issued by the NTSB – just an interim/executive summary type one.

Also, it should be noted that Enbridge CEO Patrick Daniel is retiring at 65 soon, and that they have completed an internal review with a pile of changes over the past two years (link to their announcement to provided in another post). Making an internal long lasting cultural shift in the organization will be harder though, and usually requires a shuffling of the deckchairs, or judicious use of gangplanks. Time for a major shakeup and rethinking.

It raises an interesting question, though. Much industry criticism/complaints have been made about the long drawn out approval process for pipelines. It seems to me that Northern Gateway has been on the drawing board for quite some time now. What if the NGP had been approved, built and now operating for a number of years ago under the old culture?

(personally, I believe comparing Kalamazoo with NGP is a bit of an apples/oranges comparison – one being quite old with older technology, a newer line will have a much higher degree of sophistication/measurement/automation etc.)

Having a list of options/contingency plans is always a good idea. Enbridge NGP was probably perceived as the quickest/cheapest on paper. Then there’s the real world and different players/stakeholders…

You’d think that certain provinces/jurisdictions would have a certain amount of leverage in terms of pipeline approvals in the future.

A Washington Post article (h/t Norman Spector tweet) outlines the concessions the state of Montana secured for approval of Keystone:

MALTA, Mont. — Gov. Brian Schweitzer (D) says that it took some doing to get TransCanada to strike deals for an “on-ramp” that would allow companies drilling for oil in eastern Montana and North Dakota’s Bakken reservoir to feed some of their output into the proposed 1,700-mile-long Keystone XL pipeline.

Every time TransCanada asked him about the slow pace of state permitting for the pipeline, Schweitzer said he would ask them about their negotiations with Bakken producers. This went on, he said, for about 18 months.

“I had meetings with oil guys. Everyone was telling me about their problems with TransCanada,” Schweitzer recalled. “I said, ‘I’m a rancher. And when you got a horse, a 4- or 5-year-old coming along pretty good, and you come to a point where it locks up, and it weighs 1,200 or 1,300 pounds, and I weigh only 210. Then you just saddle it up, put a bridle on, tie a front leg to a saddle horn and they’re standing there on three legs. Then you walk up and give them a push and they just about fall down. When that happens, they listen.’ ”The lesson for the oil producers was this, Schweitzer said with relish: “I said, ‘Tell you what I’ll do to TransCanada. I’ll tie one leg up there and they’ll start listening.’ . . .That’s exactly what I did.”http://www.washingtonpost.com/business/economy/states-pressure-shifted-transcanada-stance-on-pipeline-extension/2012/07/18/gJQA7vTZuW_story.html?hpid=z2

Stopping ALL pipeline projects from the oilsands is not realistic. It has a “little Dutch Boy with his finger in the dyke” feel to it.
But, if return for approval, a province (say AB) would implement a more robust and effective carbon tax, would that be something you’d support (being from AB I understand)? A carbon tax seems to have considerable support in industry including O&G – just no political will at Fed level.

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